By Bruno Federowski
BRASILIA, Jan 19 (Reuters) - Brazilian stocks hovered near all-time highs on Friday as optimism over the nation's economic prospects sustained demand for local assets, while hopes of a tie-up with Boeing Co boosted shares of Embraer SA .
The benchmark Bovespa stock index rose 0.2 percent, supported by blue chips such as Vale SA and lenders Banco Bradesco SA and Ita?? Unibanco Holding SA .
Emerging markets kicked off the year with a rally as several reports showing strong economic growth worldwide fostered appetite for high-yielding assets. Brazil's stock market outperformed, supported by expectations that policymakers will plug a budget gap and rein in runaway public debt.
Embraer shares advanced 2.3 percent on Friday, their biggest daily gain in two weeks, as traders bet the planemaker could strike a deal with Boeing to help face down a partnership between rivals Bombardier Inc and Airbus SE .
Reuters reported late on Thursday that Boeing was working to overcome the Brazilian military's objections to its proposed tie-up with Embraer with alternatives that would preserve the government's strategic veto rights and ensure safeguards for its defense programs. Latin American currencies were little changed as heightened fears of a U.S. government shutdown unnerved investors. Brazil Mexico and Chile's currencies all slipped 0.1 percent, while the Colombian peso fell 0.4 percent.
Legislation to stave off an imminent shutdown of the U.S. federal government hit obstacles in the Senate on Thursday night, despite the passage of a monthlong funding bill by the House of Representatives.
Without the injection of new money, no matter how temporary, scores of federal agencies will be forced to close at midnight on Friday, when existing funds expire. Key Latin American stock indexes and currencies at 1400 GMT:
Stock indexesdaily %YTD %
change change
LatestMSCI Emerging Markets 1232.02 0.37 5.96MSCI LatAm 3069.96 0.11 8.43Brazil Bovespa 81143.40 0.22 6.21Chile IPSA 5842.45 0.05 4.99Chile IGPA 29334.33 0.05 4.84
Currencies daily %YTD %
change change
Latest Brazil real 3.2105-0.05 3.20Mexico peso 18.6120-0.08 5.84Chile peso 605.35-0.07 1.54Colombia peso 2854.18-0.37 4.48Peru sol 3.215-0.03 0.68Argentina peso (interbank)18.9450-0.37-1.82 Argentina peso (parallel) 19.59 0.15-1.84 (Reporting by Bruno Federowski)
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